The Worm Goes Hollywood : A Company and an Artist from Orange County Work to Turn Video Game Character Earthworm Jim Into a Multimedia Star

LAGUNA BEACH — Savvy kids know that Earthworm Jim has what it takes to vanquish video game villains like Major Mucus, Psycrow, Henchrat and Evil the Cat.

That's the way things work for the unlikely superhero of Earthworm Jim, a hot-selling video game produced by a Laguna Beach-based company. In the game, Jim wins super-worm status when he dons a mysterious spacesuit that enables him to stand up against Major Mucus and the rest of the game's bad guys.

But the quirky earthworm now is running with a decidedly rougher crowd as he tries to break out of his video game niche and into the wider and more lucrative market for action figure toys, cartoon shows and movies.

Only a handful of video games--including the Carmen Sandiego series, Pac-Man, Super Mario Bros. and Mortal Kombat--have produced characters that were strong enough to branch out into other media. And none has been able to reach the heights of two recent smash hits--the Mighty Morphin Power Rangers or the Teenage Mutant Ninja Turtles.

The allure to Earthworm Jim's human handlers--including artist Doug TenNapel of Laguna Hills and video game producer Shiny Productions Inc. of Laguna Beach--is obvious. There's a potentially huge pot of gold sitting at the end of the increasingly complex product licensing rainbow.

Licensing--taking one product, say a movie, and spinning off a related product like an action figure--isn't new. Manufacturers have been producing licensed products for nearly a century.

What's new, and what Earthworm Jim's creators want to take advantage of, is the trend toward "vertically integrated products"--dramatically expanded lines that incorporate everything from movies and cartoon shows to toys, video games, fast-food chain giveaways and a wide variety of products, from toothbrushes to lunch boxes.

Nearly half of the $15.6 billion worth of toys (including video games) sold in the United States during 1994 were licensed products, according to the Toy Manufacturers of America and the New York-based Licensing Letter trade publication. And, experts say, the trend toward vertically integrated products is going to get hotter.

Disney upped the ante, observers said, with the release of "Toy Story," a movie that further blurs the line between entertainment and toys. DreamWorks SKG, the new Hollywood studio formed by three of Hollywood's most powerful executives, signaled its intent to join the fray with an agreement to have its movie-related toys manufactured by Hasbro Inc., maker of G.I. Joe, Tinkertoys and Mr. Potato Head.

Jim's human handlers are aware that their annelid--who's marketed as "a worm with an attitude"--has an uphill crawl to reach

celebrity status. But they see no reason why an earthworm can't follow in the marketing and licensing footsteps of four hard shells and the ubiquitous Power Rangers.

At the same time, Jim's backers acknowledge that engineering a hit line of licensed products is, at best, a murky process.

"Nobody can explain the addiction of things like Barney, the Mighty Morphin Power Rangers, the Teenage Mutant Ninja Turtles, phenomena that somehow hit beyond anyone's expectations," said TenNapel, who drew the original Earthworm Jim character in 1988. "If you ask the [property] creators, they'll tell you that one day they just scratched their heads and had an idea. And the idea just happened to hit."

Marketing and licensing gurus offer pet theories for why some concepts--the Power Rangers, Ninja Turtles, Cabbage Patch dolls--catch fire. But David Perry, chairman of Shiny Entertainment Inc., says success is driven by "schoolyard chatter. . . . If kids are all talking about it, it's going to be an easy sell. If not, it's a very, very hard sell."

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Jim's owners are trying very hard to give the kids something to talk about.

La Mirada-based Playmates Toys Inc., which manufactures Ninja Turtles and "Star Trek" action figures, is producing Jim's toy line and the popular video game. Universal Cartoon Studios produced Jim's Saturday morning television show, which made its debut two months ago on Kids WB network, owned by Warner Bros.

If all of that sounds a bit much for a mere earthworm, blame the Ninja Turtles, whose success changed the way the industry works. Licensing Letter reports that the Turtles have generated more than $4 billion in retail sales, including licensed product, television shows, costume movies and video games.

At its peak, Turtlemania "was like gasoline being poured on a fire," recalls Mark Freedman, a Jericho, N.Y.-based licensing firm executive who helped to shape the Turtles empire during the 1980s and early 1990s.